1. Newsroom
  2. Oil and politic talk
Menu
Analysen 23.02.2016

Oil and politic talk

Oil and politic talk

Political tensions rose after Pyongyang launched a satellite, claiming that it was part of a scientific space program.


Viewing the move as a cover for missile test, South Korea and the US responded to the threat by starting discussion over the deployment of a US Army missile in South Korea to improve the defense posture. China denounced the system’s deployment stating that it would harm its strategic security interests. Tensions worsened after recent images revealed that China had positioned missiles on a contested island in the South China Sea, just after President Xi pledged not to militarize the disputed atolls. In the meantime in California, President Obama was gathering with ASEAN leaders last week to discuss the need to ease tensions in the oil-rich South China Sea region.

Oil also sparked international debates after weeks of price collapsing. As a result, oil ministers of Saudi Arabia, Russia, Qatar and Venezuela announced a production freeze output at January levels. Crude oil was volatile last week with New York futures price rising to USD31.98 per barrel at the most before closing the week at USD29.64 per barrel on February 19th. In Hong Kong, oil companies CNOOC (8.23 HKD, +1.60%) and Sinopec (4.40 HKD, +0.92%) started this week on strong basis in line with oil price recovery. Financial companies such as AIA Group (40.10 HKD, +1.91%) and Bank of Communications (4.50 HKD, +0.67%) recovered some of their early loss caused by concerns over growth and margins. In addition, worries over developed markets central banks’ ability to spur growth and wind up inflation strengthen after Bank of Japan’s recent rules on negative interest failed to impress the market. On the winners side, China Unicom (9.04 HKD, +3.31%) and Hang Seng Bank (130.90 HKD, +3.64%) contributed positively to the Hang Seng index, which was up +0.67% since last Friday’s closing. In China, the Shanghai Stock Exchange Composite Index and CSI 300 gained +1.51% and +1.24%, respectively.

In South Korea, the KOSPI index decreased slightly -0.11% this week. Bank of Korea unchanged its key interest rate at 1.5%, opening speculation for a rate cut later this year. The South Korean auto sector registered some encouraging numbers with Hyundai Motor (149000 KRW, 0.00%) and Kia Motors (48000 KRW, -2.04%) seeing January European’s sales growing +9.1% for the former and +12.7% for the latter, on a year on year basis. Cosmax (121000 KRW, -2.81%) cosmetics manufacturer reported disappointing results amid China-related uncertainties.

The ASEAN region continued to show positive numbers as Thailand recorded GDP growth of +2.8% and Malaysia’s GDP expanded by +4.5%, both beating market estimate. On February 18th, Bank of Indonesia decided to cut its reference rate by 25bps to 7%. The Indonesian Central Bank also stated that private investment is expected to pick up this year due to greater room to ease monetary policy and a relatively more stable macroeconomic environment.

Oil and politic talk Graph

 

Guillaume_Poncet.jpg
Guillaume Poncet, Analyst
 

Expertise

Impact investing - Contributing to a more sustainable future

What are the key features of impact investing?

Read more

Meistgelesene News

Analysen 01.10.2020

COVID-19: Die UBP hält Sie auf dem Laufenden

Seit dem Ausbruch des Coronavirus begleiten und unterstützen wir unsere Kunden während dieser ungewöhnlichen Zeit einer weltweiten Gesundheitskrise. Die Bank informiert Sie regelmässig über die Anpassungen ihrer Massnahmen an die von den Gesundheitsbehörden vorgegebenen Vorsichtsregeln. Ausserdem kommen unsere Experten zu Wort, welche auf die Auswirkungen der Pandemie auf die Weltwirtschaft und die Finanzmärkte eingehen.

Analysen 30.06.2020

Aktualisierter Ausblick 2020

Weltwirtschaft - quo vadis?

Analysen 24.06.2020

Market turmoil brings new opportunities for pragmatic investors

March 2020 was difficult time for many investors, as COVID-19 spread across Europe and the US, leading to sharp sell-offs in fixed-income credit markets. While such market turbulence is not to be welcomed, its occurrence can create opportunities.

Auch lesenswert

Analysen 23.10.2020

Podcast - No election rally for the dollar

Our Global Head of Forex Strategy, Peter Kinsella, shares his thoughts on the forthcoming US presidential election.

Analysen 15.10.2020

The draw of the booming fintech sector

Martin Moeller, Portfolio Manager of our newly launched strategy, shares his view on why global fintech equities are an interesting investment right now.

Analysen 05.10.2020

Webinar – Opportunities in the Gold Mining Sector

On Thursday 1 October 2020, UBP's experts Norman Villamin and Peter Kinsella hosted a webinar with Evy Hambro, Global Head of Thematic and Sector Investing at Blackrock, to discuss what gold investors can expect in the quarters ahead.